Market Update Q2 2025

In this Winter Economic Update, we explore the paradox of strong markets amidst tough headlines.

From Middle East conflict to US trade upheaval, markets proved resilient, underlining the power of staying invested — and the message for investors is clear: diversification and discipline still work.

🔹 Global Markets Defy the Noise

The Trump administration’s "Liberation Day" tariff announcements shook markets early in the quarter, but a delayed rollout gave investors time to refocus. Emerging markets and tech-led developed markets rebounded strongly, while oil prices stabilized despite tensions in the Middle East.

🔹 New Zealand: Recovery with Caution

GDP growth picked up earlier this year but lost momentum in the June quarter. Job ads and house prices softened, while the Reserve Bank maintained interest rates at 3.25% — with the possibility of further cuts. Still, the NZX50 saw modest gains, led by standout performers like Manawa Energy and Tourism Holdings.

🔹 Timing the Market? Think Again

Data from nearly a century of US share market returns shows one timeless truth: trying to time the market rarely works. Whether the prior year was up or down, the following year's average return hovered between 11% and 13%. The takeaway? Invest early, and stay the course.

🔹 The Magic of Managed Funds

Why do we advocate for diversified managed funds? Simple. You don’t have to pick winners — you own them by default. Over 20 years, the S&P/NZX 50 rose 327%, but the median stock in that index barely beat inflation. Managed funds give you global exposure, automatic rebalancing, and peace of mind — all at low cost.

Final Thought:

In uncertain times, having a long-term plan and staying invested in well-diversified portfolios remains the most reliable path to building wealth.

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